Caretaker Prime Minister Anwaar-ul-Haq Kakar has stated that the government of Pakistan is in negotiations with Saudi Arabia to sell shares in the Reko Diq project, one of the world’s largest gold and copper mines located in Balochistan. The Prime Minister expressed optimism that a deal with Saudi Arabia could be reached by December.
Under the revised agreement, the Canadian company Barrick Gold Corporation owns 50% of the project’s shares, while the Chilean company Antofagasta withdrew from the project in exchange for a $900 million payment by three governmental entities, including the Oil and Gas Development Company Limited (OGDCL), Pakistan Petroleum Limited (PPL), and Government Holdings Private Limited (GHPL), which collectively hold a 25% share in the project. The remaining 25% of ownership belongs to Balochistan, with 15% being fully funded and 10% being on a free-carried basis.
The Reko Diq project is considered one of the world’s largest underdeveloped copper-gold areas, with the potential to produce 200,000 tons of copper and 250,000 ounces of gold annually for over 50 years.
Barrick CEO Mark Bristow has indicated that the company’s stake is not for sale, but it would have no objection if Saudi Arabia were to acquire the equity of the Pakistan government, potentially altering the ownership structure.
Prime Minister Kakar mentioned that the negotiations are ongoing, and he is hopeful that a deal with Saudi Arabia can be reached by the December deadline.
In August, Pakistan hosted officials from Saudi Arabia during a mining conference in Islamabad, where Barrick officials were also present. Barrick and Saudi Arabia’s state-owned mining company Ma’aden jointly operate a copper project in Jeddah.
The Saudi Arabia Public Investment Fund (PIF) has been seeking investments in copper projects worldwide as part of its efforts to fund energy transition projects. Earlier this year, PIF agreed to acquire a 10% stake in the Brazilian mining company Vale’s base metals business.
Prime Minister Kakar also mentioned the establishment of a new Special Investment Facilitation Council (SIFC) in July, which would serve as a one-window operation to address concerns of foreign investors. The SIFC aims to streamline bureaucratic processes and provide legal protection for foreign direct investment (FDI). It also includes a dispute resolution mechanism to address investment-related conflicts.
When asked about reports suggesting that SIFC could bring in up to $60 billion in investments to Pakistan over the next five years, Prime Minister Kakar stated that this estimate was realistic and that it could potentially be even higher.
